| When stocks are bullish - that is, when
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| | reward shareholders in a recession?
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| prices of the stock market in a steady
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| | Generally speaking, those that are tied
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| rise - it is pretty easy for anyone to
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| | to fundamental basic necessities of life.
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| make money on Wall Street. Studies have
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| | We may not buy designer jeans and sports
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| any shown that in certain kinds of
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| | cars during a bear market, but we still
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| easy-money markets, novices did just as
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| | buy heating oil and we still use
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| well as pros when it came to picking hot
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| | electricity to light our offices and
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| stocks and reaping fast profits. But the
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| | homes. So utility company stocks
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| veterans of the stock market game say
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| | generally fare well during bear markets,
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| that the real test comes when there is a
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| | as do companies that sell other basic
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| bear market and stocks fall into a
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| | commodities like gasoline. Gold and
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| general slump. Those who can make money
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| | silver and other precious metals are also
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| under those conditions will gain the
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| | a good choice for a difficult stock
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| respect of even the most seasoned
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| | market season, because when people are
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| investors. But to do it requires
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| | nervous about the future of the economy,
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| patience, research, and discipline.
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| | they tend to invest in things of
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| Picking the right stock for the economic
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| | universal value, like gold. It provides a
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| climate is not impossible, however. One
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| | sense of security, because if all else
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| way to get a handle on which stocks will
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| | fails to attract consumers, gold will
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| perform best during a bear market is to
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| | still glitter and be considered an item
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| look at the overall picture of how the
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| | of special value and significance. And if
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| stock market behaves. Usually bull
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| | you buy gold before the bear market sets
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| markets are periods that also see a
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| | in, you can probably sell it for a profit
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| strong manufacturing sector. Houses are
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| | once the demand for it increases.
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| built, cars are manufactured, and goods
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| | In summary, stocks that provide a sense
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| like appliances and clothes fly off the
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| | of stability and security through
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| shelves. The companies that make and sell
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| | ownership of those basic necessities of
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| those consumer products do well, and
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| | life are usually a good place to invest
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| those who buy their stock to share in
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| | during a bear market. And buying stocks
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| that success drive stock prices higher.
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| | whose prices have fallen to bargain
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| But when the party is over and inflation
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| | basement prices is also a smart strategy.
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| kicks in, we begin to budget our money.
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| | Many perfectly good stocks with
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| Sales volume declines, and many factory
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| | underlying value and strong earnings get
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| workers find themselves out of work as
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| | dumped when people pull their investments
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| consumer demand slackens. As wages
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| | away from the stock market en masse.
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| stagnate, so do purchases of high priced
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| | Those who are patient can buy these at
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| items like cars and homes, and this helps
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| | wholesale or below wholesale prices, and
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| to accelerate the decline of the stock
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| | then watch their purchases rise in value
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| market.
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| | once others realize that these stocks are
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| But those who buy stocks that perform
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| | good buys. When the stock market begins
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| well even in this kind of economic
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| | to climb again, those stocks that are
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| recession - the stocks known as
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| | undervalued will rise quickly and you
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| "recession-proof" stocks - can usually do
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| | will be left holding winners that you
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| relatively well, even during sluggish
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| | bought at deeply discounted prices.
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| bear markets. Which stocks continue to
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